Banks throughout the United States have embarked on a transformation aimed at creating a more inviting and comfortable atmosphere for customers within their physical branches. This shift is in response to the ongoing trend of bank closures and the increasing prevalence of digital banking, seeking to redefine the purpose of bank branches as community hubs rather than solely sales centres.
Gone are the days of imposing marble-clad bank buildings or uniform branches. Instead, financial institutions such as JPMorgan Chase and Capital One are investing significant sums in renovating existing locations and designing new ones to offer a different banking experience. Spearheading this movement is Diedra Porché, the head of community and business development of consumer banking at JPMorgan Chase & Co., who envisions these spaces as “community centres” where customers and neighbours can seek advice, participate in workshops, and access financial education.
Jennifer Windbeck, head of Capital One’s retail bank channels and operations, emphasizes that banking should focus more on providing genuine assistance and guidance rather than merely completing paperwork in a formal office setting. This shift is a response to the decline in traditional bank branches following the 2008 financial crisis, as fewer customers chose to visit branches for routine banking with the increasing prevalence of ATMs and digital banking.
Moreover, the closure of numerous bank branches in low-income neighbourhoods has raised concerns among policymakers and community advocates, who have observed the negative impact this has on small business lending and financial access for residents. The Community Reinvestment Act, established during the Civil Rights Era, was enacted to advocate for bank branches in underserved areas. However, recent trends indicate a shift in this direction, with Chase opening new branches and Bank of America reducing the rate of closures.
In an effort to integrate bank branches into the heart of communities, banks such as Bank of America have recruited in-house designers to create a more local and community-centric atmosphere. This has resulted in branches opening in unique locations or within spaces that did not previously resemble traditional banks. Additionally, JPMorgan Chase has introduced around 20 “community centres,” which are larger branches strategically located in low-and-moderate income neighbourhoods to cater to a more comprehensive set of needs for typically lower-income customers.
The new approach also aims to build trust and provide financial education, with JPMorgan Chase employees conducting workshops without any sales pitches for Chase products. Ultimately, these “community centres” are designed to act as anchors for their respective communities, offering a much-needed space for support, advice, and guidance.
As the banking landscape continues to evolve with the increasing popularity of digital banking, these modern branches serve as a reminder that the human element, trust, and community-oriented services are still essential for addressing significant financial milestones in people’s lives. Banks are acknowledging the need to adapt and provide a more inclusive, welcoming environment, and their efforts to revamp traditional branches are a positive step in this direction.